Research by the Australian National University has found global GDP could shrink by $2.3trn in a “low-end” worldwide pandemic.
According to a new study the global death toll could reach 15m in the best-case coronavirus pandemic, in the worst-case scenario the death toll could hit 68m globally.
Based on the worst-case scenario countries’ economies will shrink by as much as 8% creating a global meltdown.
Warwick McKibbon and Roshen Fernando the two researchers who published the paper warned, “even a contained outbreak could significantly impact the global economy in the short run.”
The research predicts that Britain could see 64,000 fatalities, France would see 60,000 whilst Germany would be struck with 79,000 deaths and America will lose over 230,000 people.
Based on this scenario the UK’s GDP would fall by around 1.5% whilst America’s economy would shrink by 2%.
In total the global economy will lose $2.3trn whilst Germany and Australia will fall into recessions.
In a high severity forecast the report says 68m people would die globally, with 12m in China, 1.1m in America and Russia would lose 1m in this scenario.
The outcome would mean the global economy take a $9.2trn hit, and the British economy will shrink by 6% in 2020, more than the 4.2% it suffered in the global financial crisis in 2008, according to the report.
The two researchers said the probablity of any of their projected outcomes is “highly uncertain.”
They said, “The goal is not to be definitive about the virus outbreak but to provide important information about a range of possible economic costs of the disease.
“Amidst the slowing down of the Chinese economy with interruptions to production, the functioning of global supply chains has been disrupted.
“Companies across the world, irrespective of size, dependent upon inputs from China have started experiencing contractions in production.
“Transport being limited and even restricted among countries has further slowed down global economic activities.
“Most importantly, some panic among consumers and firms has distorted usual consumption patterns and created market anomalies.
“Global financial markets have also been responsive to the changes and global stock indices have plunged.
“Amidst the global turbulence, in an initial assessment, the International Monetary Fund expects China to slow down by 0.4 percentage points compared to its initial growth target to 5.6%, also slowing down global growth by 0.1 percentage points.”